Voice of the Free Press: Are good intentions enough for soda tax?

Feb. 9, 2013

Written by

Free Press Editorial Page Editor

There’s no arguing with the good intentions behind the move to tax sugary drinks, but the move raises questions about execution and effectiveness.

The proposal is to add a 1-cent-per-ounce on soft drinks to discourage consumption of refined sugar as a way to fight obesity. Dairy products and diet soda would be exempt.

The idea is to push up the price of soda to the point that other — presumably healthier — choices become more attractive alternatives.

The unknowns include the effectiveness of higher soda prices might be in fighting obesity, and the extent to which government should intervene to reform bad habits.

Obesity is driving up health care costs for Vermont and the nation. Taken as a whole, most people certainly could do with less processed sugar in their diets.

Using the money generated by the drinks tax to offset the cost of health insurance and to make healthier options foods like fruits and vegetables more affordable and accessible for households on food assistance are certainly worthy goals.

On the down side, a soda tax to fight obesity would only target one source of sugar, and does little to reduce the overall prevalence of processed sugar on store shelves.

Also if the tax works as intended, the many small businesses that sell the sodas -- from mom-and-pop shops to vending machine operators — could see a hit on their operations.

Retailers in the Connecticut Valley worry that they would lose customers to shops in New Hampshire where there is no sales tax.

Andrew MacLean, a lobbyist for the Beverage Association of Vermont, points out a potential problem with the proposal that could undermine the effectiveness of the tax to reduce soda consumption.

The plan to levy the tax at the distributor level means there’s no guarantee that the tax would follow the specific drink to store shelves. The cost of the tax could be spread among all beverages, negating the intended disincentive.

House Speaker Shap Smith also worries that if the tax is successful in reducing soda consumption, then tax revenues will fall off over time as well, making it an unreliable source for health care money.